tv First Business KICU April 3, 2014 4:00am-4:31am PDT
the stock market cranks out new highs... in today's cover story...senate skeptics accuse gm of cultivating a house of lies. plus...amazon goes full stream ahead...and....the new film that could keep theaters packed until summer! first business starts now! you're watching first business: financial news, analysis, and today's investment ideas. good morning! it's thursday, april 3rd. i'm angela miles. in today's first look: flying high now... for the 8th time this year the s&p 500 closed at record high. the dow came oh-so-close...just a few points shy of a record close. the nasdaq finished the session up 8 points. gold gained 10 dollars oil dropped 42 cents.
google trades today under goog and googl as the stock is split in 2. and the northwestern wildcats football team is set to vote on a union april 25th. the university has until next week to file an appeal. everyone's favorite stock market bear-- todd horwitz of average joe options is here-- good morning! >>good morning. what's up? >>the stock market. that's what's up. the adp numbers showed 191 thousand jobs added. the big jobs number is still to come on fridaywill it be a market mover? >>i don't think it's a market mover unless it's going to move the market down.i think the number will be okay. i wouldn't assume a big miss here. i think the number will probably be fine. but again, you're talking about such a miniscule number
for what we really need to get better. let's say they come in with a print of 220we're still way short on jobs and still having the same issues. but a good number could spark the fed to say maybe we can raise interest a little bit sooner. but i think the markets are telling us right now that they don't expect a very good number because the expect the fed to stay fully in force. >>what about the dow theory that says when the dow jones transports and the industrial average both rally to new highs there's a bull trend. are you still a bear? >>i'm a bear but let my clarifywhen i say i'm a bear i'm not putting new money to work here and i've taken some stabs from the short side. i'm not massively short and i won't get massively short as long as the fed is involved. i'll look to pick my spots because there's certainly opportunities that we can find shorts to always trade in the market. dow theory is fine except that the dow jones is no longer an industrial average anymore so it
really doesn't compute in my way of thinking. we can make the numbers look like anything we wantthe bottom line is we are going higher for whatever reason and i look for the s&p to probably get to 1900. but i will be looking to take it short there for sure. >>thanks todd and have a nice day. >>thank you. you too. lets turn now to chuck coppola -- good morning. angie, in our cover story, missouri senator claire mccaskill accused general motors of having a "culture of cover-up" during the time faulty ignition switches were linked to at least 31-crashes and the deaths of 13 people. it's also led to a current recall of 2.6 million g-m cars and a showdown in a senate hearing room. in more combative questioning by senators than g-m ceo mary barra faced in the house, a senate subcommittee demanded to know who was responsible for the installation of redesigned ignition parts numbered the same as those they replaced on compact chevy, pontiac and saturn cars. with the same number, the change was untraceable to owners and federal safety regulators and averted a mandatory recall.
"in late 2006 or 2007, gm replaced the ignition part but did not tell anyone." subcommittee chairwoman claire mccaskill of missouri on documents that show a g-m engineer who authorized a redesigned ignition in 2006-- then denied it in a court deposition, last year. she had a phrase for that. "a culture of cover-up that allowed an enginer to lie under oath, repeatedly." barra vowed to "make change-- both people and process" "it involves cars we no longer make but since it came to light on my watch, is my responsiblity to resolve. when we have answers, we will be transparent with you, our regulators and our customers.." but barra was non-committal on whether safety concerns brought privately to automakers should be made public. also non-commital---on whether to support california senator barbara boxer's call to pull recalled vehicles from circulation as rental cars. it led boxer to tell barra "you represent the culture of status quo." barra, who's entire 34-year career has been spent at g-m, says she learned of the ignition problems in december, just days after she was appointed c-e-o. and that she
will return to answer more questions at the completion of g-m's own investigation. other g-m execs and the automaker's legal team may be called to testify, as well. 3 million vehicles were recalled during the past week according to jd power. that includes an expanded recall by chrysler for suv brake problems. 870 thousand 2011- 2014 jeep grand cherokees and dodge durangos are under recalled for possible water corrosion in the braking system that could make it difficult to stop the car. dealers will make the fix. chrysler has since designed corrosion resistent boosters. amazon takes a shot at streaming. the company is releasing amazon fire tv -- a tv set box which will deliver content from its amazon prime library. the device costs 99 dollars, offers a voice recognition search function, and hundreds of games. its release is competition for sony and microsoft. but rob endlerle says amazon could be --- if the product takes off... it could pose a bigger threat to apple. "there's no certainty that this
is going to be successful, but yes, if it is succesful...this coupled with the other initiatives amazon is driving makes them more of a google- like threat to apple than they've ever been before." enderle adds the new amazon box is also giving netflix a run for its money. amazon shares ticked down a dollar yesterday. some ups and downs for "whatsapp." the popular messaging service -- recently acquired by facebook -- set a record by handling 64 billion messages on wednesday. facebook shares initially jumped 2% but fell back to gain just a dime as what's app was hit by its second major outage since being bought by facebook. the company apologized to users. the newly-public rubicon project jumped on its first day of trading. rubicon, which sells digital ad services, priced at $15, the low end of its range. rubicon closed up 33 percent at at just over $20 on wednesday. this week - friday brings grubhub, which plans to price between 20 to 22 dollars a share. it will trade under "grub" on the n-y-s-e. also ims health trades publicly on friday. the health care consulting company plans to price between $18 to 21 dollars under stock symbol "ims"
one ipo that likely won't launch on time is virtu financial. the high-speed trading firm is reportedly delaying its april 20th ipo target date. it follows a bombshell report on 60 minutes over the weekend highlighing the book: flash boys by famous author michael lewis. lewis is promoting the book and his belief the stock market is rigged to favor high speed traders. an assistant professor of finance at the mit sloan school of management is pleased regulators are investigating the possiblity. i think in the end we need investors to know more about this market which would encourage more disclosure encourage more transparency about trading mechanisms. also under review "put" options buying on shares of nasdaq omx group. the stock dropped following the 60 minutes
report. drug maker mankind is on a hot streak. shares propelled 73% higher yesterday after an fda panel overwhelmingly approved afrezza. that's an insulin drug that can be inhaled by patients suffering from diabetes. mankind shares closed just below 7 dollars yesterday. a ruling by the supreme court makes it possble for wealthy political donors to make larger campaign contributions. the justice ruled in a 5 to 4 decision to strike down limits that stopped donors from giving more than $123-thousand per year. there will still be a limit of $26-hundred per candidate running for the house or senate, but donors can give to as many campaigns and causes as they wish. signs of spring in the housing sector. after a construction slump this winter , frank nothaft (no-taft) of freddie mac says a boost in hiring in construction is giving economists hope for a solid spring. we got some good news from the adp employment report this week, for example 191 thousand jobs added over the past month, and 20 thousand jobs added in the construction sector. so that tells me we are going to see some really good trends in terms of new construction, new
housing starts as we get into the spring homebuying season." construction spending barely budged this winter, moving up just one tenth of a percent. u- s home prices continue to rise at a steady pace. corelogic says sales rose 12.2% in february topping a 12% rise in january. meantime -- getaway homes are becoming more popular. the national association of realtors says sales of vacation homes jumped 30% last year. economists are keeping a close watch on inflation in the us and arond the globe as economies slowly recover. unemployment figures are ticking up, wage pressures are building, and european nations are emerging from recession. although the eurozone inflation rate fell to its lowest level since 2009 last month. economists fear a recipe for high inflation, but in the u.s. some think the economy's slow upward climb is leading to the fed's ideal 2 percent rate of
inflation. "i think the fed's desired rate of inflation is not so low that people are putting off spending because they think prices are going to drop, but not so high that it would cause consumers to put off purchases of needed goods and services. 2 percent is good for the fed." that was gary thayer of wells fargo advisors. he adds that unexpected economic weakness around the world or a drop in commodity prices could put pressure on inflation. president obama took the fight to raise the minimum wage to students at the university of michigan. michigan is one of 34 states considering raising the minimum wage, this year--if not by the legislature--then by ballot initiative this november. "i want to focus on something that a lot of people in michigan are working very hard to accomplish right now and that's raising the minimum wage to help more folks get ahead" mr obama wants congress to raise the federal minimum wage from 7-25 to 10-10 an hour. but in chicago, those working to boost the pay of fast-food workers, say mr. obama needs to aim higher.
"just raising the minimum wage isn't enough, it needs to be a living wage and we have to be able to form a union." wednesday evening, fast food workers in chicago protested what they call "wage theft" --- doing work before and after they've clocked out. pro golfers teeing off for the masters will compete minus tiger woods. on his website-- woods tells fans he's recovering from a successfull back surgery. he calls the situation frustrating remains optimistic about the future and hopes to return to tournaments this summer. tiger is considered a huge draw to golf tournaments and a ratings winner. however one marketing analyst we spoke with-- believes the "masters may be tiger proof. i think the masters are one of the few touranments if not the only tournament that in golf that is what i would call tiger proof from a ratings persepective the institution itself transcends avid golf fans and causual golf fans as well. and i think it will be tiger proof event from a ratings perspective. woods' is the top golfer in the world and the highest paid
athlete. blackberry is dropping its deal with t-mobile after a february spat. the relationship soured after t-mobile offered the apple iphone 5-s for free in february ...and promoted it as "a great offer for blackberry customers." blackberry says it hopes to work with the carrier again when business strategies align. it will continue to honor existing t-mobile customer contracts. still to come: the film our critic says will be an unchallenged winner at the box office until summer! plus... bill moller takes us behind the census numbers, and what its exposing about the economic recovery. and, and can you guess the top eco friendly tech company. the answer -- is after this break! ♪
apple is receiving high marks for its efforts to be a green & clean company. apple tops a greenpeace list for relying 100% on solar and wind power to operate. here's how other tech companies stack up. yahoo runs on a 59% mix of natural gas, coal and nuclear power. facebook uses 49%, google 48%, amazon 15% , and ebay 6%. bill moller brings us an update now on the hottest sectors in the economy. the data that regularly pours forth from the census bureau can give us fascinating insights into how america is an ever changing country. the bureau just came out with its newest population estimates. it also released a report on economic data. andy hait is the economic data liaison with the us census bureau. andy, a lot of numbers here - you're the expert, i'll leave it to you to
tell us what were the most striking findings that tell us something about america? >>sure. from the economic census release that just came out there are 3 major sectors that we've seen some substantial change from the last economic census. for the mining sectorand specifically oil and gas extractionwe've seen substantial increase in both the number of businesses and the percentage of the receipts from those businesses from the last economic census. this particular sector is really influencing and affecting the population data that we're seeing in our population estimates report that was just released. so that's certainly one major finding.the healthcare sector continues to be our biggest employer in the united states. this sector is not only the largest employer , it's actually seeing the largest increase in total employment of all of our sectors published in the economic census. more than 1.8 million more employees work in the healthcare sector today than worked in that sector in 2007. so that's bringing us now to 18.9 million employees that actually work in the healthcare sector. retail trade continues to be the largest scetor in terms of the number of businesses, but this sector is down in terms of number of businesses and sales in terms
of 2007. but we're seeing pockets of improvement in the retail sector looking at specific types of businesses. for example, non-store retailers have actually shown an increase from the last census. >>when you combine the numbersthe demographic and the economicwhat did that tell you? >>when we look at the population changes in the u.s. we're seeing the influence of metropolitan areas in comparison to non-metro areas where we're seeing more of the increase in those metro areas for population perspective. when we start to look at the data from the economic census we're going to be seeing similar kinds of trends where metropolitan areas is really where lions share of the economic growth has been. and when we get into our future reports the rest of this year, we'll see even more detail than what we've seen right now. >>a snapshot of america through the numbers. andythanks so much. thanks bill! still to come in chart talk... a high profile stock split...will trading be extra risky in google this week? and after the break... are big budget movies hurting hollywood's shine? that's in movies and money!!
captain america-- bursts-- onto the silver screen this weekend. but are movie studios buckling under the weight of big budget films this year? our movie guy is here. and erik, captain america: the winter soldier is the only film debuting this weekend. is it a sure bet? >>it is. it might as well be the only film debuting this month as far as i'm concerned. it was
a very smart move on marvel and disney's part to position this film to sort of get the summer going a month before it normally does. this film is going to dominate trough april. last year we saw ironman 3 and thor do very well. i'd be very surprised if this film made under $90 million this weekend. >>has it been a good year for grossing films? >>you look and see the grosses that are upwe have 5 $100 million dollar films right now. we probably have another 2 more coming by april. we only had 2 at this time last year so the numbers look good but the escalating budgets that studios have are sort of buckling under that weight. robocop for example is the 3rd highest grossing film worldwide this year but it's not even close right now to being in the black. there's only a handful of films like the lego movie and ride along that have done well enough. universal and warner brothers are the only 2 studios that can brag that they're having a pretty good year.
>>so it's tough out there. they're really counting on audiences. >>yeah. and captain america no matter what the budget of this movie is is going to be a mega blockbuster for them. it's probably going to be the number 1 film up until july for the year. >>so good news for disney >>yes. >.alright, taking a look at what happened last weekend at the box office---you hoped that noah would come in at number 1 and it did. followed by divergent, muppets most wanted, mr. peabody & sherman, and god's not dead. >>it's a good start for noah. it's at $100 million worldwide right now. that's about a third of the way to recouping the big costs that we have heard about. so i think it's probably going to make that. paramount has sort of dodged another bullet the way they did last year with world war z. >>what do you think about divergent hanging in there? you were not a big fan of this film at all. >>no, not at all. it's not quite the blockbuster i think lionsgate and summit really hoped for. it's doing well and it hasn't opened overseas yet so i imagine it's going to recoup a lot of money over there. but it's not pulling in the hunger games numbersnot that it was ever going to. but i thought it was going to do about $150-$160 million in the u.s.
and that seems to be what it's headed for. it's going to do fine but i imagine that the sequels are going to come down and that's where they're probably going to start regretting it. >>also fascinating2 religious films in the top 5. >>noah and god's not dead. but noah is the one to see. that's the one that everyone should be putting their money towards. >>erik, always a pleasure to have you on our show. thanks for coming on. >>thank you. still ahead...the thousand dollar stock now trading around $500. find out next if "the new google" is a buy...chart talk is next.
talking to veterans about the real issues they're dealing with can be awkward and uncomfortable. we think to ourselves, "i never served. how could i understand? they'll talk about it when they're ready." and then we wonder why they don't want to talk. but when their behavior changes, when they withdraw to themselves, increase substance use, or even talk about hurting themselves, it's time to act. because if we don't,
goog shares will be on the market today along with googl. good morning to joe kinahan of td ameritrade. how do you think the stock is likely to perform today? >>i think over the nect couple of weeks there could be some arbitrage in there. as a retail trader i think i take more of a wait and see on this one. the reason i say there may be arbitrage is some of the shares will have voting rights and other shares won't have voting rights. wait and see what the market values the voting rights as. i think some of the professionals may try and get in there the first few days as they try and price this out. so if you are gonna go in there and trade right now i think you're taking a little bit of extra risk that you would have to take on a normal situation. if you have the stock right nowi'm not saying to go out and sell it on that news but i think it's a time where you want to
wait and see for a couple of weeks and let the market shake things out as to what the true value is. >>what do you see in the charts for facebook? this stock has been one of those big momentum players, then it had its selloff and it seems to want to ramp back up. what do you think? >>yesterday we got a little bit of a taste of that. yesterday morning facebook came out of the gates really strong. it was up 2% at one time. amazon then came out with their news about their new streaming video product. with that---i guess buy the rumor and sell the newsthe techs in that space kind of sold off a little bit including facebook. we saw amazon down a buck. as you say, facebook gave us a little bit of a taste yesterday and was bought back down on that news. it would not surprise me to see facebook go up and touch those levels once again. >>thanks joe. > >always a pleasure. coming up tomorrow...it's traders unplugged. debating one of the hottest topics in the market: is "this" the best time in history to invest your money in stocks. don't miss it. from all of at first business...thanks for watching today and have a great thursday!
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